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Building a Practical Cyber Jukeboxby George Ziemann -- December 3, 2006 Once upon a time in 2002, Janis Ian promoted the idea of an Internet jukebox of some sort (click here, then select "The Internet Debacle"), where all of the music was available at a reasonable price, like 25 cents a song. Since Janis didn't trust any record label with the task of fairly distributing the proceeds, she suggested the performing rights organizations (ASCAP, BMI, SESAC) might be better suited to the task. Personally, I don't trust them any more than the labels. You certainly couldn't trust the Copyright Office to do it; they're still waiting for a technological clue. Even if they were capable, the IRS would have access to the records as well and no one in the record industry would want to see that happen. SoundExchange is an example of what happens when you let the industry pay royalties to artists directly -- they are unable to find them. Anyone outside the industry is a threat to everyone in it because actual facts might emerge. I see these two factors as the biggest roadblock to anything resembling an intelligent solution. Ignoring this formidable barrier, what I picture is something that would function similar to the stock market. There would still be gnashing of teeth, along with tales of fortune and ruin, without gathering hundreds of people into one building every day to scream at each other and throw pieces of paper on the floor. Barrier number two is the reality that, for this to work, there can't be a fixed royalty associated with each sale. The songwriters currently get a fixed 9.1 cents for every copy sold. Instead, we use a percentage of the sale, based on the current status quo. Since we're going for percentages, let's add a single penny to the going price and make our starting point be a $1 song. Here's how this currently breaks down, to the best of my knowledge: Songwriter/Publisher -- 9.1% There are two rational ways to determine the selling price of an individual song at a particular point in time. The first would be a simple computer-based real-time calculation based on the number of copies of the song which were purchased in the preceding 30 days, with the record label able to set the price for the first 30 days. After that, the price will be determined by demand. The hardest part of this method would be developing the scale. A second variation would more closely resemble the stock market, with sellers (labels or even artists without labels) quoting the price they're willing to sell at. Customers could either pay the asking price or make a bid of what they're willing to pay and the label can either take it or leave it. If they get desperate enough, they'll take it, especially if they have the ability to see the offers and know exactly how many sales they are missing, as well as how much they're missing them by. I think this one would be more interesting. |
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